Questionnaire on management of cases, judges’ role in the proceedings, and use of alternative dispute settlement methods: reply submitted by the delegation of Finland

A. ACCESS TO JUSTICE

1. The Ministry of Justice has issued a set of 20 brochures with descriptions of the different courts, the procedure and specific issues of the judicial system. For further information on the brochures in English, please see: http://www.om.fi/15473.htm . In addition a rather lengthy description of the juridical system can be found on the web site http://www.oikeus.fi/ . Some of the material is published not only in the two official languages of Finland, but also in English, see http://www.oikeus.fi/8108.htm . The impact of the information given on the amount of cases can not be estimated.

2. A huge number of blank-forms etc. have been issued to be used in application matters before the courts. Many of these forms can be found on the Internet and printed or filled and sent by e-mail to the courts. Please, see http://www.oikeus.fi/6558.htm .

3. In Finland there is legal aid to give individuals the possibility to obtain assistance for legal matters fully or partially at the expense of the state. In Finland legal aid covers all sorts of legal matters.

However, legal aid will not be granted if the applicant has legal expenses insurance that covers the matter at hand. In criminal proceedings, the defendant is under certain circumstances provided with a public defender at the expense of the state, regardless of his or her financial status. The victim of serious violent crime or sexual crime may be provided with a trial counsel at the expense of the state, regardless of his or her financial status. Legal aid is not available to companies or corporations

Legal aid is always applied for from a public legal aid office.

Legal aid is granted on the basis of the applicant’s income, expenditures, wealth and maintenance liability, that is, his or her available means.

The available means and the deposits held by the applicant determine whether the applicant is given legal aid for free or against a deductible.

Calculation of available means:

Income consists of wages and salary, pension and per diems, as well as child allowances, maintenance support and capital income.

Tax withdrawals are deducted from the income. Deductions are likewise made for housing costs, day-care charges, maintenance support payments, and the scheduled payments in enforcement or debt adjustment proceedings, in so far as these total more than EUR 250 per month. In addition, a deduction of EUR 250 is made for each underage child that belongs to the applicant’s household.Family size affects the income threshold for eligibility and the level of the deductible. The income of the spouse, domestic partner or registered partner of the applicant is taken into account in the calculation of the available means, unless the matter is of a controversy against just that person.

In addition to income, also the wealth of the applicant affects the granting of legal aid. A permanent home and a car that is necessary for the work of the applicant are omitted from the calculation. If the wealth of the applicant, excluding these items, is more than EUR 25,000, one per cent of the excess is added to the calculated available means. All assets are taken into account at their taxable value. Any liabilities are deducted from the assets. If the applicant has deposited funds or other easily liquidated assets to an amount exceeding EUR 5,000, these are not taken into account in the calculation of the available means, but instead used in the calculation of the supplementary deductible.

Example for a single person. Legal aid for free: available means up toEUR 650; legal aid against a deductible: available means over EUR 650 and up to EUR 1,400; no legal aid: available means over EUR 1,400

In court proceedings, legal aid is offered by public legal aid attorneys, advocates and other lawyers; in other matters, legal aid is offered by a public legal aid attorneys. These work in state legal aid offices. The offices are normally located in the same municipalities as the district courts. There are 67 legal aid offices (with 220 lawyers) in Finland.

The funds for legal aid forms a part of the budget of the Ministry of Justice. Of the means about EUR 20 millions cover the costs of the Legal Aid Offices and an additional EUR 33,8 millions is needed for the aid granted by private attorneys.

c. According to law the winning party will recover only an amount that corresponds to costs for necessary measures in the case from the loosing party. In some cases, like i.a. tenancy cases, both parties will as a rule pay their own expenses.

B. REDUCTION OF EXCESSIVE WORKLOADS IN THE COURTS

1. During the last decades there has been a clear trend to relieve judges from non-judicial tasks in the daily work. In the District Courts the secretaries have been trained in and entrusted with many of the practical tasks that until now has been a part of the judges work such as drafting minutes of the sessions and taking care of the correspondence in connection with the trials. Concerning minor criminal offences transferred to the police and prosecutors, see E c) 2 below.

A Government appointed Commission (KM2003:3) recently proposed that registration matters pertaining to real property be transferred from the District Courts to administrative authorities. The same Commission proposed also that matters pertaining to undisputed monetary claims should be transferred from the District Courts to enforcement authorities. The proposal is now sent for hearing. Further decisions are awaiting the outcome of the hearing.

2. The Consumer Complaint Board issues recommendations concerning written complaints. Decisions are based on law. The board can issue recommendations in cases which concern: a dispute between a consumer and a business which involves the purchase of consumer goods or a consumer contract; a dispute between two private persons concerning the sale of housing; a guarantee or pledge given by a private person to a creditor; a dispute concerning the waiver of a guarantee in housing transactions.

The Consumer Complaint Board does not issue recommendations if a case has been taken to court, but it can issue statements to courts. The board can issue a statement on its own initiative or at the request of the court or either party. A party can take a case to court while it is being handled by the Consumer Complaint Board. If this happens, the board drops the case.

The Consumer Complaint Board received 3 756 new complaints in 2003.

3. Statistics on court workloads are continuously collected and analysed in the courts and by the Ministry of Justice. The statistics are used in planning the budgets of the courts but also in the follow up and strategic planning, such as deciding on the number of courts and their territorial competence. Both the budgets and the strategic planning is done in collaboration with the judiciary. The court system has its own budget line, the proposal for which is agreed in budget negotiations between the Ministry of Finance and the Ministry of Justice. The Ministry of Justice, then, is in charge of the administration of the budget vis-à-vis the courts. The system adopted here is called “management by results”, under which the Ministry and each court conduct annual “results negotiations”, setting certain target figures (for cases resolved, throughput times and the like) and allocating the personnel and funds with which the result should be achieved.

4. The administration of each court is in the hands of the judges/the chief judges. Strategic planning of the judicial infrastructure etc. is done in co-operation between the courts and the Ministry of Justice. Human resources except for the selection and appointment of judges are the concern of every court itself.

Concerning information and technology solutions the decisions taken by the judicial administration’s information technology centre - a bureau under the ministry - are often dominating. In the higher courts as well as in the biggest district courts there are special administrative directors, which are supposed to have skills in management questions. Decisions in important administrative matters are taken after consultations with the staff involved.

1. No system having the aim of assessing quality of judicial activity exists in Finland. Statistics on appeals are collected but used only for purposes of planning or legal policies.2. The statistics on the activities of general courts, administrative courts and special courts have been published in the Yearbook of Justice Statistics every year since 1991. The publication (350 pages in 2003) describes the nature of cases handled in the courts, the decisions reached and factors relating to the dealing with the case, such as the duration of the procedure, the number of hearings, etc. The activities of district courts and the civil cases tried in these courts are the most significant factors described in the publication. The information was derived via the judicial administration’s information technology centre, working as a part of the Ministry of Justice.

The district courts introduced a new data management system in 1993. The new system replaced the previous diaries of civil cases, and contains also information on bankruptcies and debt cases relating to the restructuring of the debts of private persons, and enterprise restructuring. The Ministry of Justice maintains the data management system, from which Statistics Finland receives its basic data for justice statistics. The statistics are completed with data from the diaries of the courts of appeal, The Supreme Court, the administrative courts and the Supreme Administrative Court. The statistics also contains figures measuring and comparing the economic efficiency of the courts.

These and complementary statistics are used by the Ministry of Justice. During the annual discussions and negotiations on the budgets for the courts the figures form a common ground for setting the aims for the coming year, measuring the need for additional allocations etc.

Statistical data are not relevant in professional evaluation of individual judges but might in certain cases be taken into account as an indication of efficient management when considering an appointment of a chief judge to a vacant higher office.

3. As indicated above, the question of the budget for every court is every year discussed by the ministry and the court on the basis of the figures mentioned. Courts with increasing case load might get funds for additional administrative staff or for extraordinary judges for the coming year or, as the case may be, for a permanent additional judge’s office. The courts with a statistically diminishing need for judges may again find itself in the situation that funds for appointing a new judge will not be allocated when one of the present judges leave office. The statistics also form the basis for evaluating the need to revise the territorial jurisdiction between courts, which, depending on the nature of the change, might be a question for the Parliament or the Council of State.

It is worth mentioning that the commission mentioned above under B.1 recently stated that “the result-based management system is not without its problems as regards the independence of the courts. The planned intensification of the system and the more extensive bench marking and evaluation of the quality and impact of the courts’ work may aggravate these problems. Nevertheless, there is a need for the development of a more fine tuned quality measurement and resource allocation mechanism for the court system. In order to secure the independence of the courts, the judges and the courts should be intrinsically involved in the development of that mechanism”.

4. The majority in the commission mentioned proposed that the court’s central administration should be reformed and developed on the basis of an agency model of the Scandinavian type, separated from the Ministry of Justice. Until that proposal is reality the actions above are taken by the Ministry of Justice after consultation with the judiciary in question. Most of the actions also need the approval of the Parliament.

D. ALTERNATIVE DISPUTE RESOLUTION

a) in general

1. The ADR systems in Finland can be divided into mediation services and advisory services.

Mediation services are rendered inter alia:

- by courts in civil matters,

- by municipal social workers in family matters,

- by attorneys-at-law in a wide range of cases and by

- volunteers in criminal cases.

A criminal matter may be referred to mediation. Mediation is voluntary, confidential and free of charge. The objective of the mediation is to reach an agreement on the restitution of the loss caused by the offence e.g. by payment of money or performance of work. The offender and the victim meet in the presence of an impartial mediator. The mediators are trained volunteers. The initiative for mediation may come from the police, the prosecutor or a party.

If the parties reach an agreement, a written document on the same is drawn up. If the parties do not reach agreement on any detail, the mediation is called off. Successful mediation may result in a decision not to prosecute or a less severe sentence in court. Notwithstanding mediation, serious offences are likely to be considered by a court of law in any event. The municipalities are normally in charge of the administration of mediation.

An abstract from an article by Kaijus Ervasti from the Finnish National Research Institute of Legal Policy, which shortly describes these systems, is annexed to this answer to the questionnaire. Reference is made to the article.

A more complete picture of the mediation in Finnish District Courts is given in Mr Ervasti’s doctoral dissertation from 26.3.2004 Settlements in District Courts. An Empirical Study of Promoting Settlements in Civil Proceedings; a Summary in English (p.505 - 512) can be found on Internet: http://www.om.fi/optula/uploads/iohgtwzsic6r(1).pdf . An other dissertation worth mentioning is Vaula Haavisto’s academic dissertation in June 2002: Court work in transition An activity-theoretical study of changing work practices in a Finnish district court. On Internet: http://ethesis.helsinki.fi/julkaisut/kas/kasva/vk/haavisto/Depending on the definition of ADR you might include boards and advisers in available systems for dispute resolution. The most used are probably the following:

- the municipal consumer adviser network: Personal consumer advice service is given by a municipal consumer advisers. According to law every municipality in Finland must offer its residents consumer-advice services,

- the municipal Money and Debt Adviser is there to give information about dealing with personal money matters and debts and to aid indebted people in debt settlements,

- the Consumer Complaint Board is a neutral and independent expert body whose members represent consumers and businesses in a balanced way. The activities of the board is described above in B 2.

- the Finnish Insurance Ombudsman Bureau gives guidance and advice to customers and settle disputes between insurers and policyholders. The bureau’s field of operations comprises all lines of voluntary insurance as well as four statutory lines, viz. workers’ compensation, motor liability, patient and environmental insurance.

- the Advisory Office for Bank Customers was founded by the National Consumer Administration Finland, the Financial Supervision Authority and the Finnish Bankers' Association. The Advisory Office is independent in relation to the authorities and the Finnish Bankers' Association. The services of the Advisory Office are accessible to private and small corporate customers, and consist of advising the customers in questions relating to the banking business. Such as, e.g., the interpretation of agreements, information about the proceedings available to the customer when resolving disagreements with the bank, and how feedback can be given to the bank. The Advisory Office is a counselling authority, and the services provided are free of charge to the customers.

- Securities Complaint Board offers consultative advice concerning the content of securities market legislation and related authority orders, the application of contractual terms, good commercial practices in securities trading and other issues related to securities practices. The service is free of charge and available to all non-professional investors, who are customers of banks, investment firms or mutual fund companies.

In addition there are some Ombudsmen, who also try to reach solutions in disputes between parties in their own sectors, i.e. the Ombudsman for Minorities, see http://www.mol.fi/vahemmistovaltuutettu/ombudsmaneng.html

2. The list above includes some public bodies regulated by law.

3. The procedure is as a rule free of charge. Legal aid is normally not applicable.

4. There are no specific rules on confidentiality for ADR procedures.

5. No.

b) in-court ADR

1 - 3. Concerning the role of the judge in mediation, please, see annex. Today it would be inconsistent with the system for a judge to order parties to appear before a mediator.

In spring 2003 a commission appointed by the Ministry of Justice proposed that a new system of court meditation should be introduced, based on the Norwegian example. According to the proposal, a district court judge may, with the parties’ consent, transfer the case to meditation. At this stage the civil suit would be suspended. The mediator could be either another judge or any other person. If mediation failed, the trial would continue. In the proposal it is recommended that court mediation should be introduced in addition to the present system for promoting settlements rather than replacing it. For further information on the proposal, please, see the contribution by the Finnish delegate Chief Judge Brunila to the European Conference of Judges in 2003 on "The Early Settlement of Disputes and the Role of Judges"on Internet under working documents/contributions:http://www.coe.int/T/E/Legal%5FAffairs/Legal%5Fco%2Doperation/Legal%5Fprofessionals/Judges/Conferences/CONF-JUGES%20_2003_%20CONTRIB%202%20-%20Contribution%20finlandaise-1.pdf

c) out-of-court ADR

There is no specific judicial control on out-of-court ADR agreements.

d) ADR in administrative law disputes

Normally the person representing the entity has the power to settle the dispute. It depends, however, on the object of the dispute.

e) criminal law and ADR

Reference is made to the annex and D a) above. The judge is not taking part in the mediation.

For the Supreme Court please note that the average time (2003) for deciding on the question of leave to appeal (about 3 100 cases) was 4,12 months while reaching the final decision in the cases which were tried on the merits (about 180 cases) took 19,45 months. The aim for the latter figure is 16 months for 2005.

Average duration in administrative cases (2002):

- Administrative Courts 8,8 months

- Supreme Administrative Court 11,2 months

The data are obtained from the centralised computer system used by the courts and from statistics kept by the higher courts themselves.

2. The judges hands to conduct the proceedings are in general today more free than before the reform of the procedure in the district courts in the 1990’s. The law, however, often hinders the judges to restrict the legal remedies used by the parties to the necessary and to limit the proceedings to the essential. The mandatory oral hearings in the Courts of Appeal, mostly including hearing both the parties and witnesses again, if the appellant so insists, have been severely criticised. These negative phenomena have increased the costs for the parties and prolonged the proceedings.

3. The reform just mentioned aimed at transferring cases from panels to be adjudicated in first instance by a single judge. The court may decide to put several judges on a case.

b) in civil disputes

1. The principles in Recommendation No. R (84)5 have been noticed and duly implemented during the reform of the court procedure.

2 - 3. The procedure at the district courts consists normally of three stages: the written preparatory stage, the oral preparatory stage and the main proceedings. The purpose of the written and oral preparatory stages is to distinguish between what is in conflict and what is not, and prepare the case so that it can be decided in the main proceedings. In the preparatory stages one judge handles the case. Undisputed cases in which the opponent has not raised objections against the plaintiff's demand are concluded on the basis of documents during the written preparation. In practice, almost all the cases concluded during the written preparation are of the summary type. Of the 147 900 cases in the district courts 2002 a total of 142 000 were decided in written procedure, 2 000 at the oral preparatory stage and 2 500 in the main proceeding in connection with the preparatory stage and by the same judge. Only quite few civil cases thus end up in a separate main proceeding.

4.1. The judge has in some cases the power to decide summarily on disputes concerning recovery of certified not contested debts, some questions of family relations and manifestly ill-founded claims.

4.2. A summary judgement has the force of res judicata and is liable to determinate rights and obligations of the parties even if a procedure on the merits is not initiated.

7. The courts have an wide discretion concerning interlocutory measures when the party renders probable the existence of his claim and the need to secure it. Considering the measures the judge takes into account the damages the measures may cause the other party. If there is an urgent need, the measures may be ordered without hearing the other party. Because of the speedy procedure demands for interlocutory measures have become common and are increasingly used in stead of ordinary proceedings to achieve a fast solution.

8. The possibility for the plaintiff to get help from the court to gather information before the trial does not seem to be a part of the Finnish procedure in civil cases.

9. A first degree judgment is in general enforceable if the winning party provides security for any damage that might occur as a result of the enforcement. A judgement concerning payment in money is enforceable as such unless the debtor gives a security. Seized goods may as a rule not be sold before the judgement is final. The court of appeal and the Supreme Court may grant suspension of enforcement whenever they see it necessary.

10. The Recommendation R(95)5 has been noticed and the several of the principles therein have been implemented during the last reforms of the appeals system.The last amendment in this respect of the Act on legal procedure introduced a system, where the court of appeal can decide unanimously that an appeal will be dismissed without further procedure on the grounds that the decision of the court of first instance obviously is correct. The Supreme Court looks into the merits of a case only if a leave to appeal is granted. The question of granting a leave is decided by two or three justices in summary proceedings.

c) in criminal matters

2. In traffic cases and certain other simple violations, the police issues notifications of penal order proceedings (”tickets”), complete with payment slips. All such notifications — some 750,000 every year — are checked by prosecutors. In most cases, the prosecutor issues an equivalent penal order, unless the recipient has contested the notification. Two or three per cent of the checks result in a correction or adjustment on the prosecutor’s own motion. The notification of penal order proceedings can be contested within a period of seven days. In this event, a pre-trial investigation and consideration of charges are carried out in the matter, possibly leading to a charge being brought in a district court.

A criminal case can today in many cases be decided on in the absence of the defendant. A recent proposal from a commission contains a system, where a special written procedure would be introduced for crimes where the alleged offender accepts the charges. Criminal acts punishable by imprisonment exceeding two years would, however, not be included in this system.

3. (i) the prosecutor has the power to decide that a criminal procedure be discontinued. Only the injured party may in that case continue his proceedings.

(iv) see 2. above.

(vii) notification is usually done by mail.

ANNEX

Kaijus ErvastiResearcherNational Research Institute of Legal Policy

MEDIATION IN AND OUTSIDE FINNISH COURTS

(extract)

4. Mediation in Finland

4.1 Mediation in court

Civil procedure in Finnish lower courts was reformed in 1993. According to the law, the judge in the lower court should determine whether there is a basis for a mediated settlement in the case, and seek to promote such a settlement between the parties. Usually, any mediation would take place in the oral preparatory stage. The judge may also submit a proposal for a mediated settlement to the parties. If the parties agree to settle the case, the court may affirm the settlement and this will have the same effects as a court decision. However, the judge should not put pressure on the parties to reach a settlement. Instead, the judge should give a decision in the case if the parties desire this. There are very few provisions in law on this, nor are there any more detailed provisions on how the judge should seek to promote a settlement.

The Finnish National Research Institute of Legal Policy has carried out studies on how the civil procedure reform has been implemented. According to the studies, at present about one fourth of all cases that go to the oral stage and the main proceedings end up in a settlement that is affirmed by the court. On the other hand, it appears that the activity of lower court judges in Finland in this respect has not been uniform. Some are quite active in seeking to promote settlements while others are quite disinclined to do so.

During the summer of 1997, a questionnaire was sent out to judges, advocates and public legal aides regarding the implementation of the civil procedure reform and, in this connection, also regarding settlements. The results suggested that the one factor that most clearly promoted settlements was that the parties had legal counsel. It also appeared to be easier to reach a settlement when the financial interests in the case were small and when only a few individuals were involved. About one half of the advocates and almost one third of the judges and the public legal aides were of the opinion that the impartiality of the judge has been endangered at least in some cases in the negotiations on a settlement. About one half of the advocates and the public legal aides were also of the opinion that the judge had at least in some cases sought to pressure them towards a settlement. On the other hand, when interpreting the results we should consider that at the time of the study the system of mediation was still under evolution.

The system of mediation used in Finnish courts differs from the system used in many other countries in that the same judge both seeks a settlement and decides the case in court. Indeed, one fundamental problem is how one can combine two styles of work, judging and mediation, which have different ideological and theoretical points of departure, approaches and goals. The problematic nature of this situation has been emphasised also in the international debate. According to some observers, the use of mediation in court should be seen as a collision between two cultures. Here, there is the danger that both processes – judging and mediation – are damaged. Also some judges and advocates in Finland have seen the situation to be problematic. However, this is primarily a question of a theoretical problem, and apparently in practice the Finnish system has functioned relatively well.

Consideration has also been given to whether a judge may discuss the case with both parties separately, without the other party being present, given that in principle the entire proceedings should be public. In practice, judges engage in such discussions. Another point of concern has been that the Finnish system requires the judge to seek a settlement that is in line with substantive law. In other words, the settlement should correspond as closely as possible to what the outcome would be if a court decision were to be given in the case. In many respects, however, the idea of mediation lies in it not being tied to substantive law, but to the will of the parties. On the other hand, discussions regarding a possible settlement are generally conducted during the preparatory stages, when decisions must be made on the basis of incomplete court records; for example, evidence would not be submitted until the main proceedings. In such cases, it may be difficult to anticipate the "right" outcome.

Criticism has also been levelled on the grounds that the impartiality of the judge may be endangered if he or she informs the parties of his or her early views of the outcome of the case. In line with this, the possibility that the court has of reaching an objective result is endangered if no settlement is reached. In particular if the judge has been quite strong in asserting a certain position, and the court has to decide the matter, one of the parties may consider him or her to have been partial. Situations where the judge has suggested a settlement that was not accepted are particularly problematic. One point of discussion has been whether or not the same judge can then continue with the preparation of the case and also serve as judge in the main proceedings.

In some countries, such as Sweden, a system has been created where the court can order a person not associated with the court to serve as the mediator. If no settlement is reached in the case, it will be returned to the court. Such a system, however, is not in use in Finland.

4.2 Mediation in family cases

For over fifty years, Finnish law has contained provisions on mediation in the case of divorce proceedings. According to these provisions, mediators in family cases can seek on request to provide assistance and support when there are family conflicts and when conflicts arise in the implementation of a decision or settlement on the care and custody of a child or on visiting rights. In particular, mediation should seek to safeguard the position of the child. It has proven to be difficult in practice to draw a line between mediation, family counselling and therapy. Mediation in family cases is primarily dealt with by municipal social welfare workers, who usually have an academic degree. They are charged also with helping parties to a divorce reach a settlement on the custody and care of children.

4.3 Mediation by advocates (attorneys at law)

In 1998, The Finnish Bar Association initiated a system of arbitration that can deal with a variety of types of conflicts. The system is a voluntary one. The parties to a conflict may designate an advocate (attorney at law) who will then serve as a mediator between them. So far, the system has been used to deal only with a few cases, and it is still a system in evolution. The system of mediation primarily calls for the advocate to create a suitable atmosphere for mediation and get the parties to reach a settlement between themselves. The mediator himself or herself, in turn, does not strongly seek to influence how matters of substance are dealt with, and tends to remain in the background. This system of mediation has been offered in particular to companies as a method of mediation, but it can be applied to all types of conflicts.

4.4 Mediation in criminal cases

At the beginning of the 1980s, a structure for mediation in criminal cases was created in Finland, subject to the social welfare authorities on the municipal level. This mediation structure has strong links with child welfare, juvenile work and social welfare. In particular offences by juveniles have been the focus of mediation, and the offences that most often have been dealt with are assault, vandalism and theft. The mediators are volunteers who have been given a brief amount of training before beginning their work. So far, municipals are not required to arrange for mediation in criminal cases, but in practice about 70% of the population can use mediation. It has recently been proposed that a special Act of Parliament be drafted on mediation, and that its availability be expanded to cover all of Finland. Already today, any mediated settlement can be taken into consideration when the public prosecutor decides whether or not to raise charges.